tv Bloomberg Markets Americas Bloomberg January 31, 2018 10:00am-11:00am EST
♪ we are going to be reviewing the state of the union and diving into lots more stories particularly following yesterday's market selloff. let's get to economic data coming out right now. julie hyman is right here. julie: pending home sales rising right in line with estimates, .5% from one economists had estimated. to aequirements revised little better than what had been estimated. the year-over-year number is in decline of 1.8%. trying to piece that together since the numbers seem to be in line with estimates. you are still seeing a relative strength in the housing market. some of the numbers have been a little more uneven. this is still showing an expansion. pending home sales are a
forward-looking indicator. this coming amidst a rebound and stocks from today's of the clock, the worst selloff we have seen since august. in an unusual one since there have not been many percentage points from stocks last year. not recouping the losses of the past several days. take a look at the bloomberg to get a better sense -- this is just a daily percentage change in the s&p 500. friday, we had a more than 1% gain, swinging yesterday to a 1% decline. that has become increasingly unusual over the past year or so. what is helping the rebound along, strong earnings reports. a lot of companies talking about tax benefits, boeing among them. that company benefited from surging deliveries of the 737. the boeing shares are rising to a record today. best performer in the dow last year. radcom is on the rise after that
company came out with earnings at a forecast that was above estimates. finally, electronic arts as well. the company showing weakness sales in its star wars: battlefront game. download,or games mobile, the migration to digital , essentially. we are seeing the dollar go down and positioning has gone it neutral. that is if you take a look at the fx positioning alert -- sorry. there it is. the dollar is going lower. positioning is going neutral. we will see what it means for the further trend of the dollar, vonnie. vonnie: julie, thank you for that update. breaking news. fox has signed an unprecedented five-year contract for the rights to thursday night football. it is a five-year deal, again. people familiar with the matter said that fox submitted a bid higher than the $45 million a
game that cbs and nbc had been paying. let's get more from paul sweeney and bloomberg intelligence. obviously doubling down your. there are reports that fox will pay $550 million a year for 11 games, $50 million again, more than the $45 million that cbs and nbc paid. looks like the nfl might be getting a premium year-over-year. the big thing to note about this transaction is that it is a five-year deal. up until this point, nfl has given one-year deals for the thursday night game. they are locking in a partner for the longer term here. bid,e: cbs and nbc didn't abc and turner didn't bid at all. is fox doing the right thing given that viewership is down percent? paul: second year in a row, and clearly there has been a ratings issue. the ratings issue that has impacted television for a lifetime has impacted the nfl. fox has to make a statement.
they are selling most of their assets to the walt disney company. what is remaining is the broadcast network and the news network. for the fox network, they need to make a statement that they are still very much in the sports business and there is no better way to do that, from their perspective, then the nfl. vonnie: how does this impact amazon's rights to digital streaming? paul: one of the things that the nfl has shown over the is is no better -- nobody is bette at slicing and dicing than the nfl. i would expect to see in the years ahead a much bigger package of programming going to one or more digital partners over the time as the nfl looks to continue to grow its audience as bachus television and cable television continue to contract. vonnie: what does it mean for sunday night and monday night football? is more better for everybody, or is it fracturing the market too much? paul: there is a school that is
best for the management of 21st century fox that the thursday might be too much, saturating the market place, and that might be contributing to the ratings decline we are seeing across the board in football. it looks like the nfl is happy with the packages they have and will stick with the thursday night games. vonnie: paul sweeney, our thanks. mark. mark: we are 90 minutes way from the end of the wednesday session. we are giving downwards now come -- giving downwards now, down for the third day. best monthly performance since october. the start of this year has brought gains to most european benchmarks. the one that stands out for the wrong reasons if you are long is the ftse 100, dominated by the strong pound, risen by 4% against the dollar. having an inverse affect on the ftse, which is dominated by international companies. the ftse is down over the month,
but the european benchmark -- the stoxx 600 is rising. outy's decline wiping earlier gains. they did a piece today in the eurozone was inflation data. 1.3% in january. slower than the prior month's 1.4%. core inflation in which strips out volatile elements such as food and energy, rose to 1%. still well below the ecb's target also economic road is at its strongest level in a decade. joblessness in the region has declined. price pressure failing to pick up to a similar extent despite unprecedented efforts by the ecb. wonderful chart showing european equity options traders are optimistic about the trajectory of financial stocks. hedging against declines in the sector is hovering at the lowest level since 2015.
that is the white line there. strategist at citigroup and ubs bullish amidst rising bond yields. let's stick with the banking theme. one of the banks reporting earnings, we have an interview with the chairman, or the chairperson. up by .6%nd shares today. latin america's biggest economies fueling better than hercted results, helping with a third straight year of rising profits since she took over in 2014. we will be listening to her little bit later. vonnie: indeed we will. in his first state of the union address, president trump argued that his policies have set the u.s. up four. eriod of wealth and opportunity. president trump: this is our new american moment. there has never been a better time to start living the american dream. vonnie: the president pitched
his $1.5 billion now infrastructure plan and immigration reform. did not get into specifics. joining us is kim wallace from his first interview in his role as the managing director of eurasia group. also a former treasury assistant secretary in the obama administration. details last night were a little sparse. didn't surprise much. did the political winds change in the last 24 hours? kim: political winds really change by words. we will see if the president and his team give rise to bipartisanship that the president referred to last night. vonnie: tax reform was done by house ways and means. infrastructure will have to be done by a whole range of committees, most likely. how does it get done? kim: it gets done when republicans and democrats agree on the design of the program and how to finance. there is no agreement on those principles right now and they
will not get beyond words until they agree on those problems. mark: kim, infrastructure, that is the biggie. he talked about maybe bipartisanship on criminal justice and drug prices. what is achievable on those fronts? kim: what is achievable there, mark, is infrastructure. as soon as the committees get to work on documents built by consensus, they will have a good chance of moving them through. we have not seen that type of work in his congress yet. hope springs of journal. my guess is how they deal with -- hope springs eternal. my guess is how they deal with fiscal issues would give us an indication of how this congress and president will work with democrats going forward. mark: were you surprised, kim, by the lack of new policies? often presidents in their first state of the union address layout two or three things they want to achieve. were you surprised by the lack of detail, the lack of ambition? kim: not surprised by the lack
of details. these speeches are very rarely containing a lot of the jump. i would say, mark, so, that the president listed a long, ambitious list of things he would like to accomplish, from veterans care to the opioid crisis to the prescription drug crisis. the president wasn't reticent in telling congress what he would like them to do. not exactly started congress have to get that accomplished. vonnie: we've got the quarterly funding for the treasury, much of it and the long end. i want to give a look at chart 1156. total treasury debt outstanding. the president wants a $1.5 trillion infrastructure plan out as opposed to $1 trillion, and the company is dealing with a major tax regime change. kim: it's a good point, vonnie. congress, washington in particular, will have to deal with fiscal policies, the debt
that has been created, that they inherited, and how they will manage the debt going forward before you get any visibility on large spending programs. i don't think it is realistic to expect that to embark on more debt financing until they digest the debt that has been created in the last two years in particular but over the last 10 years as well. vonnie: what happens on february 8? do we get another continuing resolution? do we get another shot down? 8 will be ay precursor of what happens the rest of the year. i'm not sure either party things they did well in the shutdown. the president claims he did well, but the polling data does not suggest that, at least not on a long-term basis. it is not good for washington to shut the government down for reasons that americans don't understand. when you have buoyant markets and a relatively strong economy, it is very hard to justify doing business in washington via shutdown. i don't expect another shutdown.
mark: trump stayed away from inflammatory language on trade. it comes days after he tried to put forward this notion of his america first agenda coexisting with globalization. can the 2 coexist? kim: they can, mark. i think it is entirely explainable for a head of state to want reciprocal and fair trade. that phrasing in and of itself shouldn't upset anyone. to the degree that the administration is willing to work with congress on a bipartisan basis to push through policies that achieve the objective, it would be great. my sense on trade, though, is that arrested at international constraints on unilateral action will continue to hem in the parameters of what we expect on trade. at the end of the speech i was telling people that, frankly, if you are concerned about a bombastic trade policy coming from the trump administration, those risks have gone down in the last month, including last night. last week was,
also notable from the comments from first steve mnuchin and then donald trump on the dollar. what is the government's position on the dollar right now? kim: as is stated by the president, it is a preference for a strong dollar. it is often the administration's particularly new to washington go to the running process of learning process about and went to speak -- go through the learning process of how and when to speak about the dollar. i wouldn't be surprised if the treasury secretary as he was at davos. vonnie: what did you make of the democratic response or bunch of responses last night? are the democrats getting their acts together when it comes to the midterms? kim: well, in one way the polling data suggests will label have to do is stand there -- all they will have to do is stand there and they will get some benefit of reaction to the current administration. when you talk about the policy agenda, the two parties continued tuesday past each
other. there has not been a top-down agreement on a policy agenda. it will not bubble up from the bottom. it has to start from the top down. vonnie: so when we get properly into the campaign for the midterms, are we going to see a cohesive gop and democratic party, or are we still going to see fracturing all the way to the midterms? abouthe factors we know on the policy agenda will determine whether or not we see tension or cooperation. and then there is the unknown knowns, what happens with the mueller investigation and how much that becomes a distraction in washington. those factors, the agenda and what they decide to work on and how they pursue that work, and what the special prosecutor and his team and of doing sometime this year. those are the things i would watch to answer the question of how 2018 and policymaking for washington fx markets and economies. vonnie: kim wallace, managing director at eurasia group, thanks. mark? mark: let's take a look at the markets and have a look at what
all sectors took a beating, but energy, health care, and tech got hit the hardest. joining us is bloomberg's equity strategist. are we over the hump and can we get back to rallying? >> maybe. it seems hard for investors to side against the earnings trend, that is what is giving stocks of foot. earnings estimates revision in the u.s. has been 4.5% higher over the last month. that is nine times the average case of the last live years. we have one third of committees on the s&p 500 that have reported earnings, that is driving this revision. those likely are also producing higher earnings estimates. it is hard to fight against that . at the same time, starts did sell off for the last couple of days, potentially because they were a little overheated, potentially because commodity markets were selling off, potentially because interest rates got higher.
the underlying all of this is a much better earnings trend and fighting against that is tough for equity investors to do. vonnie: there were asset class movements. started in asia overnight and it is easy for the nervousness to be contagious. does this pick up steam at some point? is this a preview of what is to come if the tide turns all of a sudden? gina: if you see the tide return and earnings revisions -- potential impacts of tax reform -- then you might reach a stall point. equities are more vulnerable to movements in interest rates, movements in commodities, movements in global equity markets, and the risk-off mentality starts to be more contagious. it is just we are not there yet. in 3, 4, 5 weeks time, when the earnings season is over, you then reached the point where you have to have some economic momentum to really justify the current state of existence in the equity market.
we are just not quite there. mark: gina, i'm looking at a wonderful markets live coverage, and i'm looking at a piece that says on average, more than 81% of the s&p 500 fell in these recent days. that sort of selling hasn't been seen in 18 months. it says you have to go back even further if you want to find such bloodletting when stocks are making you high. what is the breath of the selloff tell us? is that a harbinger of anything or not? gina: i think it is frankly too early to say. the breadth of deterioration in momentum was not particularly significant. at the same time, you have stocks that are still a brilliant. this is not a 2% decline in stocks. this is a vix that has moved less than 20. it is not consistent with any broad-based selloff so far. but there was profit taking and it was across industries for a number of reasons. you talk about interest rates.
accelerating pretty quickly last week. investors came in on monday and said that the interest rates have moved higher quickly. at the same time, commodity prices sold off a little bit. health care news yesterday. there was justification for most of the industries to experience a bit of profit taking, but it is modest in the grand scheme of things. you are comparing something to the last 18 months, the last 18 ofths have been a period historically very limited volatility. no changes except for modest changes to the upside. you look at the longer term scheme of things, and this is still pretty modest. mark: i want to show you this wonderful truck, g #btv 9279. it shows of the inverse coalition between the stock 60 and the euro, and the chart says the negative correlation hit a six-month low. does that tell us that the eurozone stocks can weather any further increase in the euro? the troublek --
with europe right now is you are heading into earnings season. earnings season is going to tell us a lot about how companies are in real time feeling the burn of a much faster or much higher euro that occurred over the last year. it really depends, frankly, on the next four weeks of earnings season out of europe. how are these company's contending with currency appreciation, and will they then be able to contend with appreciation going forward? this is a longer-term story than just what has happened so far this year. there has been a tremendous lag in the european data as a result of currency, and also as a result of interest rates. there is a couple things going on right now. monetary policy is changing, too. there's a lot to watch for in europe. vonnie: gina martin adams, our thanks to you for that. still ahead, a bloomberg exclusive with tom barrack, the billionaire investor and one of trump's closest friends. he weighs in on the state of the union. this is bloomberg. ♪
vonnie: this is "bloomberg markets." i am vonnie quinn in new york. mark: from london, i'm mark barton. shares taking a little lower today. margins are remaining under pressure in 2017. the ceo who took over in september after a surprise the project believes that new money will be rolling in soon. >> i feel very comfortable that we will be within the range of 4% to 6%. we have not changed for net new money. with the hiring we see we thank 18 higher -- we plan to hire managers and i feel comfortable we can deliver that. mark: the julius baer chief executive there, vonnie. vonnie: mark, it is time for our latest "business flash," the
biggest business stories in the news right now. gaining control of xerox in a deal that would give it an $80 billion company, it would give a corporation synonymous with coffee machines desktop emissions -- synonymous with copy machines new lines of business. it owns 49% of the new committee called fuji xerox. approved a stock split, a move to enhance shareholder value after posting record earnings in the last three months of the year. still ahead, a bloomberg exclusive with tom barrack. this is bloomberg. ♪
mark: that is one of the highlights from tictoc, streaming live on twitter. live from bloomberg's european headquarters in london, i'm mark barton. vonnie: live from bloomberg world headquarters in new york, i am vonnie quinn. this is "bloomberg markets." breaking news on oil inventories, a build of 6.2 million barrels, a much bigger build them markets were anticipating. this is the for some we have seen a build in 10 weeks. 10 weeks of the kind followed by this massive bill. best 10 weeks of decline followed by this map -- 10 weeks of decline followed by this massive build. gasoline inventories, a drawdown, more than the market
was looking for. we are seeing a decline in crude oil. it was lower at the start of the session. we are below $64 a barrel. down three quarters of 1% off the back of that build in crude oil inventories, mark. mark: vonnie, great stuff. let's check in with "first word" news. taylor riggs as more from new york. taylor: the head of the centers for disease control has quit over a stock scandal. according to politico, brenda fitzgerald bought several health-related stocks after she was appointed. total employee compensation in the uss match the biggest 12 month again since 2008. the labor department says wages and benefits were up 2.6% back to hire pay in the private sector. the increase shows employers and making were generous offers to compete for workers in a tight labor market. the adp says the u.s. companies added 234,000 jobs in january. that beat the average estimate
from economists. the government comes out with a monthly jobs report on friday. and in china, the official gauge --factory activity film fell this month from hitting and it month low. curb excessive borrowing are moderating output at home. global news 24 hours a day powered by more than 2700 journalists and analysts in over 120 countries. i have taylor riggs. this is bloomberg. vonnie? vonnie: president donald trump's first state of the union address touched on everything from immigration to infrastructure. despite being an hour and 20 minutes long, it was very light on specifics for new policies. erikore perspective, schatzker joins us from los angeles with the billionaire investor and longtime friend to president trump -- we all know him well. erik: vonnie, thanks very much. i'm here with tom barrack, chairman of colony northstar
come here in our spectacular los angeles bureau on this beautiful morning in the west coast. good morning to you. tom: good morning, erik. erik: this was the president opportunity to strike a tone different from the anger and frustration we have seen a history. how do you think he did? erik: i think you did a terrific job. the president in a bipartisan and mr. is never going to gain applause from all sections of any audience, but he did with everybody was hoping for. his cadence was smooth, his delivery was perfect, he was on ,cript, he was inclusive beautiful, touching, american stories. the focus of the policy issues was soft in tone. dreamers is a big issue for everybody. attacking that and in a sophisticated and compliant way was difficult.
i think for the world watching and saying that we need to some emotional piece of this leader, they got that. vonnie: you have no the -- erik: you have no the president for almost 40 years and you have explained his missteps in the first year by saying that he is new to politics and learning on the job. now that he is in his second year, should we expect a different kind of donald trump? tom: never, never. i think what we have all learned is that would be a bad thing. the amazing thing is we are learning to interpret a different long-range from -- different long-range--dip-- different language from potus. he didn't have any skin in the game rather than taking the barnacles off of establishment machine that we all agreed needed some work. forget the political point of view, because i don't have one. amazingly, his instincts running his own system works.
if you look at what he has accomplished -- talking about the economy and the stock market , and, all of those things, which are phenomenal, but even though she started with the islamic --he started with the islamic ban, and what are we doing? ban to from an islamic with informants convening the first arab-islamic conference in todi arabia, coming together explain their intolerance to radical islam. we move from that to moving the capital of israel to jerusalem. drawing a line in the sand with the palestinians, which the sunnis are on -- it is amazing. it is not the cadence of diplomacy that the world is used to watching and give them
comfort. same thing with china. -- theagine president xi two of them have to be the most powerful leaders in the world -- sitting at mar-a-lago, being invited to a country club, thinking this is a little strange. remember, that was the day he sent the ballistic missiles into xiria must president is sitting next to him, and he leans over between the steak and chocolate cake and says, "i think there is something i should tell you, 57 minutes alyssa missiles are going to go. -- ballistic missiles are going to go." tech related -- that created a relationship between the two men. erik: you mentioned the stock market. the president likes to take credit for the strike of the stock market. you did it in his address to congress. isn't that dangerous? tom: sure, sure. look, he deserves credit for continuing to steer all of these things -- the economy.
president obama also deserves credit for starting the process. it is an aircraft carrier. it doesn't turn on a dime. i think as part of what the president needs to do, instill confidence and hope and enthusiasm and the ability for entry newer -- entrepreneurs to invest. erik: right, but if you hit your wagon to- hitch your start prices, it goes down from that isn't good for confidence. tom: i don't think he is worried about that. --is about getting enthusiasm is the best it has been for a long time, work a list of who gets credit for it. erik: no surprise to anyone that he steered clear in his commentary of the mueller investigation. as he talked to you about the possibility of either firing the special counsel or deputy attorney general rosenstein? beyond my jobay
is fiction, but i can tell you this -- bob mueller, there is nobody better. whatever you say about this investigation, it wasn't mueller's idea to do this investigation, but if you were to choose an individual, you wouldn't find a better individual. princeton, marine corps, distinguished in every thing he has done, 12 years and the fbi. this man is not political. he is doing his job and the mission he set out to do. inside of all the rhetoric to hear about the firing and the fbi -- not erik: witchhunt? tom: yeah. it is what it is. erik: do you think the president has respect for the mueller investigation? tom: absolutely. erik: what if he does fire him? tom: i honestly don't think it is a possibility. erik: lawyers on both sides say there may be enough evidence in the public domain -- forget about what bob mueller has --piled behind closed doors
to bring an obstruction charge. are you worried that might happen, that is where this is headed? tom: no, look, i'm not worried it will happen. what i'm worried about is all of us being so engaged in a process that is not fruitful for getting the agenda of america done. that being said, this needs to take its logical conclusion. it is happening. when you are going to help them just keep on going. going through --when you are going through hell, just keep on going. the politics on both sides are very complicated. let them do their work and get on with life. it will be better. the lawyers are doing what lawyers do. the president would love, i guarantee you, to sit down with robert mueller and say, i have nothing to hide, i want to deal with it straight up with the american people.
the lawyers are lawyering. as a lawyer to my client, you shouldn't do that. i guarantee you, the president is saying i don't care, i have nothing to hide, let me take it head on. erik: the republican party was well last week by a report concerning allegations of sexual misconduct against steve w ynn. did the president has to take over as chair of the rnc? tom: i think the president still has some modicum of liking for me, so he wouldn't give me a titanic to jump on. steve wynn is one of the greatest human beings, great business -- what he did for the rnc -- erik: he raise a lot of money. tom: first-class human being. he is caught in a tsunami and part of it has personal tangential pieces to his divorce, i'm sure. this is a guy who runs one of
the best female-oriented operations in the world. 40% of his executive force are women. 2 of his past presidents are women. i can tell you as being a personal friend, he is a first-class gentleman and i've never seen a taint of anything. but it is par for the course. being under the opera lover perceptive problem, he had -- the umbrella of her perceptive problem, he had to do the right thing and resign. it is something i'm not interested in. erik: i don't want to run out of time before asking you about colony northstar, your company. it is easy to spend all the time talking about the president and your relationship with a man, but i don't need to remind you that the stock hasn't been doing well. it has returned negative over the past year. the market has been on fire. reits are still in positive territory. what is going on?
tom: if you remember, the cycle of colony was a merger with northstar, and mergers are always difficult. we know it at the time, we buoyed up to a company that is very complicated, andy -- and the market hates complication. the only way you make money is complication, but the market hates complication. over the past year we have been unwinding and stripping and we are committed $3 billion in logistics -- a team related $3 $3lion in -- we accumulated billion in logistics. probably one of our greatest things that we are spinning off, a mortgage reit. we clean off the balance sheet and we define what the silos are and we go more to cash. that is complicated for the market to see -- erik: ok, but to that point, it seems as if the stock reflects
nothing of the real estate holdings. you are getting no credit for the fact that you are an asset manager. what is going to change that? furthermore, from the data i have seen, you have not been divesting a lot to take advantage of these robust real estate evaluations. would havely, been investing a lot. erik: it just doesn't show up in the data? what is going to turn the tide? tom: what i've learned from running a public company, and my partner, is really simple -- you do the right thing to make money, and you cannot calibrate it in quarters when you are turning an aircraft carrier, which is what we have done with these 2 gigantic companies. we are slimming the silos of what we are building the investment management by creating greater liquidity. the market is confused about what is in front of us. all they want is everything. the market wants more dividends,
higher value, more simplicity, lower leverage, and if i were houdini, i would give it to them tomorrow morning. it is the largest element of my personal network -- net work. we will make it happen. i love discovery. the opportunity for liquidity and management is the best i've seen in history. erik: tom, i want to thank you for spending time with me and ellie -- in l.a. tom barrack is the chairman of colony northstar and a longtime friend of president donald trump's. vonnie: thank you for bringing us that exclusive from los angeles today. mark: coming right up on "bloomberg markets," boeing shares are on the rise as the company reports of surging deliveries of the 737. this is bloomberg. ♪
mark: live from london, i'm mark barton. vonnie: from new york, i'm vonnie quinn. this is "bloomberg markets." time for our stock of the hour, bowling. the company beat fourth-quarter estimates. abigail doolittle joins us now with more details. abigail: they certainly put up an impressive quarter. they are known for their commercial airlines and they have defense and aerospace businesses. before the dish behind the big top and bottom line beats, deliveries surging. second, they also have this one time unexpectedly big tax gain. that drove the bottom line beat. owing forward, it looks like the tax-cut is also going to help the company because the 787 dreamliner, the big sized plane,
over the last decade that has been a profit loss, but now it is turning into a cash cow. generatinghis plane all this cash flow, suggesting that this could be a banner year for cash flow. they are projecting $15 billion for operating cash flow in 2018, perhaps helping investors getting behind the lofty valuation. vonnie: how much is priced in? the stock has already doubled. abigail: you are right about this, the stock has been on a tear. they executing and that is one reason for investors to be very interested. another reason, ge. let's look at g #btv 1172. both of these copies are big dow stocks, but ge is down half, while over the last year boeing is up more than 100%, almost 120%. investors that might have been looking for the ge dividend in the past, boeing has an $18 billion buyback they have pledged and they are raising
their dividends 20%. investors who had been in the ge may be going for boeing, and the growth is strong. for flight ahead -- full flight ahead for boeing. vonnie: ha ha, pun intended. abigail doolittle with the second hour. mark: the vice chairman, we will get his outlook on the fed and central banks ahead of janet yellen's final fed meeting. this is bloomberg. ♪
to 17% this year, and on strong topline growth, doing things really the right way for customers, loyal customers, digital really well on digital. good performance in brazil. mexico also. actually, all of latin america has done well. francine: are you worried about protectionist measures taking force in 2018 after we have heard noise from president trump? to this thelook actions, and what the u.s. has done in terms of the economy is pretty good. the tax bill is very encouraging with us and others who will put that back into higher wages and more lending to customers. the new administration has all the right attitudes in terms of supporting growth and making banks support growth again through all of these measures. we are very encouraged about the u.s. economy. francine: what you expect interest rates to do, and how
does that help markets and are businesses? ana: it is a double-edged sword for banks. we have the rates go up and the yield curve happening and that is good, as long as they don't go up too much. however, we are somewhat concerned what happens when it ends. what does it mean for markets? we saw bond prices and equities doing not very well. that is one of the things we look out for this year. francine: your outlook on the u.k., how is that going? are you worried about the u.k.? ana: i would like to separate the u.k. as a country and our bank. if you look at the top line, it is growing around 5%. we have positive jobs. and pretty good performance. however, there is a slowdown in the economy, and 2018, the u.k. is the country that is going to
grow the least. for us, every single country this year is expected to grow. but the ones work with will be less will be the u.k. francine: will brexit mean that you have to move some of the investment banking outside the u.k.? ana: we have very few. the most british banks -- by the way, the most resilient, running to the bank of england stress test, so that is a good place to be in this situation. for us, whatever happens to the u.k. economy, but we will do better -- in a less good scenario, santander u.k. will outperform. the santander chairman speaking to a very own francine lacqua in madrid earlier. coming up on the european close, less than 31 minutes what from the -- away from the end of the session. you can see it on the lovely --
board right there. gauge, stoxx 600 falling for a third day. finished the month higher, though, strongest since october. eurozone inflation, headline inflation weaker, better than estimated but still weaker. core inflation picking up, but well below the ecb's target range. giving the ecb food for thought as it considers whether to -- this is the bond market today. you are seeing the u.k. and the german 10-year yield rising. close is 33 minutes away. ♪ .
vonnie: i am vonnie quinn and this is the european close on bloomberg markets. ♪ mark: here are the top stories we are covering. stocks snap a two day losing streak with the dollar slumped deepening after the state of the union address. the euro is rising after inflation data. the data, central banks what to expect from the final meeting as janet yellen as fed chair, we look at the next ecb decision. the markets brace for tech earnings, including facebook, google, and amazon, a preview of what to expect. have a look at european equities 30 minutes away from the end of the wednesday session. gmm is the function,